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FINRA Releases 2020 Risk Monitoring and Examination Priorities Letter

January 15, 2020
Volume 2


  • Regulatory Notice
  • UPC Advisories
disciplinary actions

Disciplinary Actions


Upcoming Deadlines and Effective Dates
  • FINRA Request for Comment
  • SEC Request for Comment
  • Renewal Program

Education and Compliance Programs

The Annual Verification deadline in the FINRA Contact System is January 27, 2020. Firms are required to complete an annual verification of their contact information within the first 17 business days of each calendar year. The deadline for firms to complete the annual verification in the FINRA Contact System (FCS) is January 27, 2020. For instructions on performing the review, see the FCS Annual Review Guide. Rule 4517 requires firms to update designated contact information promptly upon any material change, verify such information annually and comply promptly with any request for such information via FCS.

Conversations about Libor. As broker-dealers and financial services firms prepare for a transition away from Libor, Haimera Workie and Richard Vagnoni from FINRA’s Office of Financial Innovation sat down for three separate conversations about the implications of the change, how regulators are approaching the issue and what firms should be doing to prepare for possible life after Libor.

Registration is now open for FINRA’s eighth annual Diversity Summit on April 1 in New York City. This free, one-day forum provides business leaders, diversity practitioners and human resource professionals in the financial services industry the opportunity to share ideas and effective practices to promote inclusion in the workplace. Register today to network with like-minded colleagues and gain valuable insight on the practical implications associated with creating a corporate culture that cultivates diversity of thought to drive innovation and creative problem solving.

FINRA has released its 2020 Risk Monitoring and Examination Priorities Letter, highlighting the areas of focus for FINRA’s risk monitoring, surveillance and examination programs in the coming year. The letter discusses in greater detail significant new areas of emphasis for these programs in the coming year and summarizes other areas that have been described thoroughly in prior letters.


Retrospective Rule Review Report: Payments for Market Making

In November 2017, FINRA launched a retrospective review of Rule 5250 (Payments for Market Making), which generally prohibits members from receiving payments for market making, to assess its effectiveness and efficiency. The review is part of an ongoing initiative to periodically look back at a rule or set of rules to ensure they remain relevant and are appropriately designed to achieve their regulatory objectives, particularly in light of industry, market and technology changes. Based on the assessment, which involved feedback from both internal stakeholders and a wide range of external stakeholders, FINRA has determined to maintain the rule without change. Regulatory Notice 20-03 summarizes the review process, the predominant themes that emerged from stakeholder feedback and the basis for the determination.

Covered Agency Transactions

Members are reminded that the implementation date of the margin requirements for Covered Agency Transactions pursuant to SR-FINRA-2015-036 has been extended to March 25, 2021. See the Federal Register notice, available on the FINRA website, for more information.

UPC Advisories

The following UPC Advisories were published in the last week:

  • UPC #01-20 GUE Liquidation Companies, Inc. (fka FTD Companies, Inc.) (FTDCQ)
  • UPC #02-20 Fusion Connect, Inc. (FSNNQ)
  Disciplinary Actions

FINRA publishes disciplinary actions to remind registered representatives and firms of specific conduct that violates FINRA rules and may result in disciplinary action. FINRA posted the following disciplinary item on the website this week:

 Upcoming Deadlines and Effective Dates

FINRA Request for Comment

FINRA is conducting a retrospective review of Rule 4530 (Reporting Requirements) to assess its effectiveness and efficiency. Regulatory Notice 20-02 outlines the general retrospective rule review process and seeks responses to several questions related to firms’ experiences with this specific rule. The comment period expires March 9, 2020.

SEC Request for Comment

The SEC requests comment on FINRA’s proposal to amend the Membership Application Program rules to help further address the issue of pending arbitration claims, as well as arbitration awards and settlement agreements related to arbitrations that have not been paid in full in accordance with their terms. The comment period expires January 21, 2020. See the
Federal Register notice.

Renewal Program

The Payment Deadline for 2020 Final Renewal Statements is Friday, January 17. Adjustments resulting from registration approvals or terminations as of December 31, 2019, are included in this final statement. FINRA recommends firms with a balance due submit payment via E-Bill. See Regulatory Notice 20-01 and visit the Annual Renewal Program page for details.


 Education and Compliance Programs

Highlights from FINRA’s 2019 Regulation Best Interest Conference, as well as a full recording of the conference, are available on our website.

Register today for a Region Member Forum in your area! These one-day events, which feature sessions on key topics like the SEC's Regulation Best Interest, are designed to provide financial professionals in the region the opportunity to engage in discussions with FINRA staff and connect with industry leaders and peers.

Reserve your spot at FINRA’s premier event! Register today to receive reduced conference registration rates for the 2020 Annual Conference on May 12–14 in Washington, DC.

Save the Date for these upcoming FINRA events:

  • FINRA Institute at Georgetown Certified Regulatory and Compliance Professional® Program – Week I | July 19–24, 2020 | Washington, DC
  • Small Firm Conference | November 11–12, 2020 | Santa Monica, CA
  • FINRA Institute at Georgetown Certified Regulatory and Compliance Professional® Program – Week II | November 15–20, 2020 | Washington, DC

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Regulatory Contacts
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